POLITICAL NOTEBOOK; Scrutiny of Hevesi Stirs Up a Quiet Race

By MICHAEL COOPER

Published: September 28, 2006

State Comptroller Alan G. Hevesi minced no words when he released an audit last year chiding a former mayor of Oswego, N.Y., for spending $3,500 in city funds on questionable dining and travel expenses, unnecessary late fees for his credit card and 379 directory-assistance calls on his city-issued cellphone.

''We take a zero-tolerance approach to local officials who abuse their position and use public money for their own benefit,'' Mr. Hevesi said at the time. He said the mayor had ''abused the taxpayers' trust and misused their money.''

Now it is Mr. Hevesi, a Democrat seeking re-election this November, who finds himself on the defensive for using public resources for personal benefit.

Mr. Hevesi acknowledged last week that he had used a state worker as a chauffeur for his wife, Carol, for more than three years, and that he had failed to honor his pledge to reimburse the state. Mr. Hevesi sent the state a check for $82,688.82 this week to pay for the driver, who he said had spent 40 percent of his time driving Mrs. Hevesi in recent years.

The revelation about Mrs. Hevesi's driver has shaken up a sleepy statewide race, and its ripples are now spreading into the campaign for governor.

On Tuesday night, during the first gubernatorial debate, Attorney General Eliot Spitzer was put on the defensive over the actions of Mr. Hevesi, his Democratic ally. Mr. Spitzer called Mr. Hevesi ''honest,'' but added that he ''would not tolerate that sort of abuse of the public fisc.''

John Faso, the Republican nominee for governor, has seized on the issue, urging Mr. Hevesi to resign and accusing Mr. Spitzer of going soft on a political ally. ''If Alan Hevesi were a Wall Street executive, Mr. Spitzer would have called him a criminal with great fanfare at a press conference,'' Mr. Faso said in a statement on Wednesday.

The revelations are damaging for Mr. Hevesi, who likes to describe himself as the state's chief fiscal watchdog and whose office routinely audits government bodies for sloppy accounting systems or misuse of taxpayer dollars. For much of this year, Mr. Hevesi seemed like such a lock for re-election, with a Republican opponent who is little known and woefully underfinanced, that Mr. Hevesi often joked that the November election had been canceled.

Then his Republican opponent, J. Christopher Callaghan, took a shot in the dark, and it hit its target. Mr. Callaghan made a call last week to a hot line that Mr. Hevesi had set up for citizens to report government abuse and passed along an uncorroborated tip: that Mr. Hevesi had been using a state worker to chauffeur his wife.

Mr. Callaghan's call forced a red-faced Mr. Hevesi to acknowledge that the accusation was true. Mr. Hevesi's office said that he had wanted the driver for his wife, who has been ill, for security reasons, noting that he had received threats related to his official duties. But it is unclear whether Mr. Hevesi ever got an independent assessment of any dangers that Mrs. Hevesi faced, as the State Ethics Commission advised him to three years ago. The commission told Mr. Hevesi that if security was not an issue, he should refrain from using the state driver, or reimburse the state.

It is far from clear how much the controversy will benefit Mr. Callaghan. As of the last filing with the state elections commission, in July, Mr. Callaghan reported $42,866.93 in his campaign account, compared with the $5.9 million the Hevesi campaign reported having in the bank.

Now Mr. Callaghan suddenly finds himself with a potentially powerful issue to use against Mr. Hevesi, but no money to buy television ads. And while some officials in the state Republican Party say that the recent revelations have caught the attention of donors, Mr. Callaghan said that he had yet to feel the effects.

''I'll be frank,'' Mr. Callaghan said. ''There hasn't been a flood of money. There are many discussions about the potential of this, and I believe it's real, and I believe it will help our fund-raising efforts. Stay tuned.''

Until this week, many Republicans felt that their best shot at winning statewide office this year rested with Jeanine F. Pirro, who is running for attorney general. But with Ms. Pirro's announcement on Wednesday that she is under federal investigation for considering secretly recording her husband to check on his fidelity, some Republicans are now taking another look at Mr. Callaghan, given the new scrutiny of Mr. Hevesi.

Now Mr. Hevesi, whose job it is to hold government agencies accountable, has to explain why he failed to reimburse the state until the matter became public, and why his office had to estimate the expense in the absence of more specific records.

David Neustadt, a spokesman for the comptroller, noted that Mr. Hevesi had acknowledged making an error, and said that the $82,000 he is reimbursing the state covered all the rides Mrs. Hevesi received, regardless of whether they were for security reasons. And he noted that Mr. Hevesi himself had asked the ethics commission to review the matter.

''People should be held accountable, including him,'' Mr. Neustadt said. ''He's being held accountable.''

Photo: Alan G. Hevesi, with his wife, Carol, left, and daughter, Laura, in 2002, has reimbursed the state more than $82,000 for Mrs. Hevesi's driver. (Photo by David Karp/Associated Press)